Suriname - Bauxite
Suriname's bauxite deposits have been among the world's richest. Active in Suriname since 1916, SURALCO, a subsidiary of the Aluminum Company of America (ALCOA), has had a long-standing working relationship with the Australian-owned BHPBilliton. The year 2008 was a turning point in the future of bauxite in Suriname. Talks between the government and BHPBilliton on the joint development of the Bakhuys Reserves in west Suriname broke down in October 2008. Soon afterwards BHPBilliton, citing a drop in the world demand for aluminum, severe losses by its parent company caused by the world economic downturn, and the uncertainty of future endeavors in Suriname, announced it would cease operations in Suriname.
Soon after the decline of the gold industry a new mineral began to play a leading role in the Suriname economy. At the end of 1916 representatives from Aluminum Company of America (Alcoa) established the Surinaamsche Bauxiet Maatschappij (SBM; Suriname Bauxite Company) in Suriname. During the years that followed they bought up many of the known bauxite deposits and in 1925 the SBM started constructing a mine in Moengo, an abandoned Ndyuka Maroon village, about 100 kilometers east of Paramaribo, along the Cottica River.
A few years later, in 1926, the SBM bought the Rorac mine along the Suriname River some 30 kilometers south of Paramaribo. Several other mines would be developed in this area in the years to come. In 1938 a Dutch bauxite company (N.V. Billiton Maatschappij) was established in Suriname. The high demand for aluminum during World War II saw production peak in 1943 at 1,660,000 tons. Production dropped immediately after the war, only to increase again to over three million tons by 1953. In 1964 the production of bauxite topped four million tons, two years later it was five million. Peak production was achieved in 1973, when Suriname produced almost seven million tons.
In the 1960s ALCOA built a US $ 150 million dam for the production of hydroelectric energy at Afobakka, some 100 kilometers south of Paramaribo, which created a 1500 square kilometer lake. Some 6000 Saramaka Maroons were forced to relocate to existing villages above the lake or to newly created transmigration villages below the lake. An alumina refinery and an aluminum smelter were built at Paranam, 30 kilometer south of the capital city. The installed capacity of the aluminum smelter was 60.000 tons, but water levels in the lake did not match expectations, forcing Suralco to shut down half of the unit.
In 1999 the aluminum smelter was shut down altogether, but the production of alumina remained high at about 5000 tons per day. Today the economy of Suriname is still dominated by the bauxite industry, which accounts for more than 15% of GDP and 70% of export earnings. Nearly 300 million US Dollars of alumina is exported annually.
Traditionally the extraction of bauxite has taken place in the old coastal plain, but as deposits in the coastal area are nearing depletion exploration for new mines is now underway in the interior. The major mines at Moengo and Lelydorp would be depleted by 2006. Other proven reserves exist in the east and west of the country. However, distance and topography make the development of these deposits costly. Options are being explored to find cost-effective ways to develop new mines. At the close of the 20th century both gold and bauxite mining companies were moving further into the traditional territories of the kin-based societies and competition for natural resources has grown significantly stronger.
BHPBilliton announced it would end its 70-year presence in Suriname in 2010, departing after the conclusion of its joint venture agreement with SURALCO, which includes mining Kaaimangrasie and Klaverblad mines until depletion, predicted for 2010. BHPBilliton also announced it would turn over to SURALCO its 45% stake in the refinery. The government set up its own mining company, ALUMSUR, and on April 22, 2009 signed a memorandum of understanding (MOU) with the Swiss Glencore International AG which will finance the development of ALUMSUR to take over the BHPBilliton operations after 2010.
Delays in the process of issuing new mining concessions led to a gap in refining operations in 2010; SURALCO announced a reduction in the refinery’s capacity in order to retain enough bauxite to keep the refinery operational after 2010. Other proven reserves, sufficient to last until 2045, exist in the east, west, and north of the country. However, distance and topography make their immediate development costly.
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